Latest / Behavioral Economics with Fexingo: Decision Making, Bias, and How People Really Spend
Why Your Brain Splurges on Luxury When You Feel Broke
Episode 47 of Behavioral Economics with Fexingo. Lucas and Luna explore the 'licensing effect' — the psychological loophole that lets you justify a big splurge right after you've done something virtuous, like saving money or working out. They anchor the episode in a 2023 study from the Journal of Consumer Research showing that people who exercised for 30 minutes were 40% more likely to buy a luxury item afterward, compared to a control group. The hosts unpack why this happens: your brain treats the virtuous act as a 'license' to indulge, a kind of moral accounting…
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